Building an Insights Engine – HBR.org Daily
The most successful companies don’t just have good products and strong distribution systems—they have a deep understanding of customers. That naturally requires lots of marketing data, but the authors say it also takes an “insights engine”—a set of structures, people, and processes that can translate data into actionable strategy.
How do high-performing organizations achieve this kind of customer centricity? Extensive research by the lead author’s firm indicates that seven operational characteristics are critical for a superior insights and analytics group: It must be adept at synthesizing data, independent from other functions, integrally involved in business planning, collaborative, willing to experiment with new technologies and programs, future oriented, and active in strategic decision making. In addition, the people who are part of the insights engine share three key traits: They have a whole-brain mindset (they think creatively as well as analytically), they focus on business growth, and they are effective at getting their messages across with engaging storytelling rather than dry recitations of data.
The authors discuss each characteristic in turn, using the consumer goods giant Unilever as a case study. Unilever’s Consumer Markets and Insights group, the epitome of a powerful insights engine, has helped the company generate impressive revenue and sales growth.
Operational skill once conferred competitive advantage; now it’s table stakes. The new source of advantage is customer centricity: deeply understanding your customers’ needs and fulfilling them better than anyone else.
A study involving more than 10,000 practitioners examined the strategies, structures, and capabilities that distinguish high-performing, customer-centric companies. Having an independent insights and analytics function that participates fully in business planning and strategy is key.
Unilever’s CMI group embodies the so-called insights engine through its expertise in synthesizing data, close collaboration with other functions, innovative use of new technologies and programs, and whole-brain mindset that balances creative and analytical thinking.
Operational skill used to confer long-term advantage. If you had leaner manufacturing, made higher-quality products, or had superior distribution, you could outrun competitors. But today those capabilities are table stakes. The new source of competitive advantage is customer centricity: deeply understanding your customers’ needs and fulfilling them better than anyone else.
